Analysis of the Short-Term Impact of UBS's Reduction in ZTE Holdings on Hong Kong Stocks

On December 15, 2025, UBS reduced its holdings of ZTE Corporation (00763.HK) by 1.9256 million shares at a price of HK$28.07 per share, involving approximately HK$54.04 million, and its shareholding ratio dropped to 8.89% [1][2][3][4]. After the event, ZTE’s Hong Kong stock closed at HK$26.520 on December 16, down 4.673%, with a trading volume of 108,000 shares [5]. Short-term technical indicators show that the 10-day moving average (SMA 10) crossed below the 20-day moving average (SMA 20), forming a “death cross”, which implies that the short-term trend has turned pessimistic [5].

It should be noted that the timing of this reduction event highly coincided with Morgan Stanley’s downgrade of ZTE’s earnings forecast and target price. Morgan Stanley downgraded the rating due to factors such as weaker-than-expected Q3 2025 performance and the expanding domestic 5G revenue gap [5]. Therefore, the short-term decline in ZTE’s stock price is the result of the combined effect of UBS’s reduction and Morgan Stanley’s rating downgrade, rather than a single event.

As an internationally renowned institutional investor, UBS’s reduction behavior may send a cautious signal to the market regarding the company’s short-term prospects. Combined with Morgan Stanley’s rating downgrade during the same period, this combined signal may increase institutional investors’ doubts about ZTE’s performance growth and industry competitiveness. The appearance of the technical “death cross” further strengthens the short-term bearish expectations, which may trigger some investors to follow the trend and sell.

: The combined effect of UBS’s reduction and Morgan Stanley’s rating downgrade has created short-term pressure on the stock price, with the technical side turning pessimistic and short-term volatility likely to intensify [5]. Institutional investors’ confidence may be negatively affected, and close attention should be paid to subsequent changes in the company’s fundamentals and institutional holdings.

: Currently, only short-term impacts can be judged; long-term investment value needs to be comprehensively evaluated based on factors such as the company’s fundamentals and 5G industry development trends. If the company can improve its revenue structure or achieve better-than-expected performance, there may be an opportunity for the stock price to recover.

1. The event of UBS reducing its holdings of ZTE Corporation (00763.HK) actually occurred on December 15, 2025; the year 2024 provided by the user may be an error [1][2][3][4].
2. After the event, the stock price fell 4.67% in the short term, and a “death cross” formed on the technical side [5].
3. The stock price decline is the result of the combined effect of UBS’s reduction and Morgan Stanley’s rating downgrade [5].
4. UBS’s reduction as a well-known institution may affect market confidence, but the specific degree of impact needs to be judged based on subsequent institutional reactions and the company’s fundamental performance.

This report is only an analysis based on existing data and event background and does not constitute investment advice. Investors should make cautious decisions based on their own risk preferences and market conditions.